Early proponents of Eventbrite (NYSE:EB) are jumping with joy after the company announced that it’s raising its IPO pricing range.
While the company originally intended to debut on the market with a price range of $19 to $21 a share, hopeful executives now believe that they could actually debut at the $21 to $23 per share range. The news has set huge expectations for the company’s foray into the market, one of the most interesting tech-based IPOs of 2018.
Here’s everything you need to know about Eventbrite now that it’s raised the public’s expectations, and how the company intends to use the huge sums it intends to reap from its IPO going forward.
A New Way Of Selling Tickets
If you’ve never heard of Eventbrite, you may just not be getting out that much. That’s because the company is most popular amongst concert-goers and rabid fans of entertainment events that sell tickets. Eventbrite essentially acts as a digital platform for ticket sales, allowing both event-organizers and event-attendees to find and distribute tickets to various shows with relative ease. It’s rapidly coming to reshape the way that many venues sell tickets to the eager masses, and could be one of the most-watched disruptors of 2018 if things go well.
Thus far, there are plenty of reasons to be hopeful. According to filings made by the company with the SEC, for instance, Eventbrite has seen some impressive growth in recent years that may be the defining factor behind its recent pricing range increase. Per its S-1 filing, for instance, Eventbrite saw its net revenue jump up to an impressive $201.6 million in 2017 from the $133.5 million it brought home in revenue in 2016. Net revenue for the first six months of 2018, too, increased by a whopping 61.2 percent, a figure that may have the eyes of some investors bursting out of their heads.
Not everything is cheery with Eventbrite, however; despite the fact that the company has been increasing its net revenue recently, net losses have actually gone up on a per-share basis. Net losses per share were only .44 cents in 2017, but in 2018 they’ve already spiked upwards to .73 cents per share. This could be a notable stumbling block for the company when it makes its market debut in New York. Still, investors interested in tech and innovative disruptors have plenty of reason to gamble on Eventbrite as it moves forward.
The company has displayed a masterful approach to acquisitions, for instance, building a sizable business empire for itself by gobbling up its competitors and incorporating them into its own operations. Eventbrite recently made its largest acquisition ever – it’s done 7 total – for a whopping $200 million, gobbling up its rival Ticketfly to better command its rapidly-growing market. Eventbrite’s tendency to purchase so many of its competitors has led to the company having a sizable pool of industry-specific talent that it can rely on as it moves to expand after its market debut.
A Potentially Mammoth IPO
Eventbrite isn’t aiming for low-hanging fruit with its IPO, either. With its price range now increased, the company will be offering some 10 million shares to the open market at the rate of $21 to $23 apiece, which could net it as much as $220 million if things go well. That huge sum of cash, that can be traded on flash fx, could be instrumental for Eventbrite, especially if it wants to keep up its acquisitions-spree. The company could alternatively decide to cool it when it comes to scooping up competitors after its IPO, however, as a way of reducing its overall debt burden.
According to the Wall Street Journal, Eventbrite was worth a tremendous $1 billion during one round of funding in 2014. That alone could guarantee that investors flock to it, confident in its size and assured that it will continue to dominate the online ticket-sales market. If the company proves effective at event-management in the long-term, it could ultimately become the king of an industry that’s set to see some tremendous growth in the next few years. One market report noted that the market for event management software will swell to a colossal $10.57 billion by 2023, after all. Most of the money Eventbrite will get from its IPO will be put towards paying down existing debts, which could soothe some investors worried about how much the company’s acquired in just a few years. The company recently faced a terribly-embarrassing data breach, however, where hackers exposed well over 20 million accounts. If Eventbrite doesn’t get serious about data security soon, it won’t last long in the tech market. With the way things are going right now, however, Eventbrite is doubtlessly gearing up to have one of the biggest tech IPOs in the latter half of 2018.